Rice v. West

157 P. 1105 | Or. | 1916

Mu. Justice Harris

delivered the opinion of the court.

When the action was commenced in the District Court the relation of debtor and creditor did not exist between Hume and the Wests, because the purchase price had been paid in full, and as between the sellers and the purchaser the latter had become the owner of the property, so that he neither owed the Wests money nor held any of their property. The validity of the judgment which Eice obtained against Hume in the garnishment proceeding must therefore depend upon the Bulk Sales Act and the statutes regulating attachments.

Before proceeding with the discussion it will be necessary to note some of the provisions of the bulk sales statute. Section 6069, L. O. L., makes it the duty of a person when about to purchase a stock of goods in bulk to demand, at least five days before the consummation of the purchase and five days before payment of any part of the purchase price, “a written statement under oath containing the names and addresses of all the creditors of said vendor.” Upon receiving the written statement under oath the vendee is required by Section 6070, L. O. L., at least five days before completing the purchase and paying any part of the purchase price, to cause to be notified ‘ ‘ each of the creditors of the vendor named in said statement, of the proposed purchase by him * * and whenever any person shall purchase any stock of goods * * without having first demanded and received from his vendor the statement under oath * * and without having also notified or caused.to be notified all of the creditors of the vendor named in such statement, * * such purchase * * shall, as to any and all creditors of the vendor, he conclusively presumed fraudulent and void.”

Eice is not entitled to a judgment against Hume on the facts which Hume asserts and Eice admits. Section 316, L. 0. L., requires the garnishee to “return the allegations and interrogatories of the plaintiff to the court or judge, with his written answer thereto”; and by Section 319 the plaintiff is permitted to reply in such answer, the issues being tried as ordinary issues of fact between a plaintiff and defendant; and if no reply is filed, the answer “shall be taken to be true and sufficient.” Eice did not file a reply and consequently the averment made in the answer to the allegations and interrogatories must be deemed to be true. The answer informs us that at the time of the purchase Hume obtained a statement from the Wests which gave the names of the creditors, three in number, with the amount of their claims; and that those creditors have been paid in full. The Wests informed the plaintiff of the sale to Hume, and Eice replied by saying that he would look wholly to the Wests for the payment of the account for the jewelry stock.

1. The Bulk Sales Act was not strictly complied with, because: (1) The statement was not made under oath; and (2) the statement was not given at least five days before the purchase. The purchaser did, however, obtain a statement which contained all the information required by the statute, although the oath was lacking. Even where the statute is strictly complied with, a creditor loses his right to void the sale if he makes no move to protect his claim. Eice was notified, and then in effect consented to the sale by saying that he would look wholly to the Wests for the payment of his account. Every benefit which the statute has designed for the creditors was made available to Eice, and yet he not only in effect gave his approval to the sale, but he waited for two years before making any move to repudiate such approval and void the sale, and he has therefore waived his right to claim the benefit of the statute. The transaction between Hume and the Wests was characterized by honesty and fair dealing; nothing was concealed from Eice, but, on the other hand, he was informed of the truth; there was no attempt to deceive or defraud; and although the statute was not technically observed, nevertheless Eice was informed of all that, he would have known, even though the statute had been literally followed. If the bulk sales statute had been strictly complied with, nevertheless, his own conduct would have precluded him from now calling upon that statute for aid, and by the same token he ought not to be heard to say that a failure to take a formal step in a technical way will relieve him from what would otherwise be a complete waiver on his part.

There is an additional reason for setting aside the judgment against Hume. As the record comes to us there is nothing to show that Eice was a creditor of the Wests at the time of the sale to Hume on December 6, 1912. It is true that one of the allegations made by Eice .is to the effect that the Wests owed the plaintiff $180 at the time of the transfer, but it is also true that the answer returned by Hume denies that allegation.

2, 3. Still another reason demands that the judgment be vacated. When the sale was made to Hume the Bulk Sales Act applied to “any stock of goods, wares or merchandise in bulk, ’ ’ but it did not include fixtures: Lee v. Gillen, 90 Neb. 535 (134 N. W. 278). The amendment of 1913, which includes fixtures, has no application to the instant case because the amendment was enacted after the sale: Chapter 281, Laws'1913. Even though it be conceded that Rice is entitled to the benefit of the Bulk Sales Act, still he can only hold Hume liable for such property as was embraced by the statute. The fixtures not being included by the statute, it follows, therefore, that the stock of drugs was the only property which the garnishee purchased subject to the Bulk Sales Act. Rice" cannot hold Hume liable for any amount greater than the value of the stock of drugs because, by the terms of Section 320, L. O. L., the liability of the garnishee is limited to the ’money value of the property. It is admitted that Hume paid $1,600 for the fixtures and the stock of drugs, but there is not a word in the record to indicate the value of either the fixtures or the stock of drugs, and consequently it is impossible to determine the value of the stock of drugs. The controversy between Rice and Hume is like an ordinary action where the burden rests on the plaintiff to establish a liability before being entitled to ask for a judgment. Before Rice can say that Hume must pay him $224.05, he is required to show that the stock of drugs was worth at least that amount. There is no evidence to support one of the elements necessary for a valid judgment: Case v. Noyes, 16 Or. 329 (19 Pac. 104); Smith v. Conrad, 23 Or. 206, 211 (31 Pac. 398); Williams v. Gallick, 11 Or. 337 (3 Pac. 469); Caldwell Banking & T. Co. v. Porter, 52 Or. 318, 323 (95 Pac. 1, 97 Pac. 541).

The judgment is reversed. Reversed.

Mb. Chibe Justice Mooee, Me. Justice McBride and Me. Justice Bean concur.